Level 1

Economics clarification

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90984 Demonstrate understanding of decisions a producer makes about production

Updated June 2014. This document has been updated in its entirety to address new issues that have arisen from moderation.

Clarifying the language of explain, explain in detail and integrate

Explain means to identify a key idea and to discuss, giving reasons, why or how economic concepts relate to the given context. For Achieved a student would identify the main consequences in the explanation of the production decisions, but may or may not refer to the presented data or information in the explanations related to producer decisions.

Detailed explanation means to thoroughly explain in depth. The student would present data or information correctly and use it to help explain how and why producer decisions affect production and the resulting consequences for the producer and/or society. The explanation focuses on separate or distinct parts in detail, thereby demonstrating an in-depth understanding which is required for Merit.

Integrate means explaining the links that exist between the components; evidence sourced from the data or information is used to establish relationships between economic concepts, explaining how and why these relate to the given context for Excellence. Students explain how and why the consequences link back to each production decision, and by integrating all the component parts the student forms a complete, whole explanation.

For examples of the different levels of explanation and integrating, see the level 1 exemplars of student work.

Clarifying Non-price Marketing

The economic concept of non-price competition relates to the ‘marketing’ strategies that producers use to increase sales revenue and market share.

An explanation of non-price competition would include product variation and product differentiation, and how these increase demand if successful, without having to reduce profit margins to increase market share, but they do increase the producer’s costs of production.

Clarifying Goals

Non-commercial goals look beyond the usual primary commercial goals of profit and sales maximisation, and could be environmental and social goals. For example:

  • Environmental goals or becoming green focuses on our external condition or surroundings. Producers would take into consideration the quality of life of plants, animals and humans when making production decisions.
  • Social goals are derived either through social obligation, or social responsibility or social responsiveness or a mixture of any or all three, and could influence decisions a producer makes about production.

The area of goals in the standard can be widened to investigating iwi/hapū organisations, non-profit organisations and charities, which may have different goals and values. Additionally, social entrepreneurship and social innovation may become part of the production area of goals. 

 
 
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